Global investment firm KKR and Singtel’s move to acquire the remaining 82% stake in ST Telemedia Global Data Centres (STT GDC) for S$6.6 billion (US$5.1 billion) is more than a straightforward ownership reshuffle. The deal, which values the data centre platform at an implied enterprise value of S$13.8 billion (US$10.9 billion), underscores how hyperscale data infrastructure has become a core strategic asset in the AI and cloud era and how capital intensity is reshaping who controls it.
Under the agreement, funds managed by KKR and Singtel will take full control from founding shareholder ST Telemedia, with KKR holding 75% and Singtel 25% after conversion of preference shares. The consortium had already invested S$1.75 billion in 2024 through preference shares and warrants in what was described as Southeast Asia’s largest digital infrastructure investment that year. Since then, STT GDC’s pipeline has expanded from 1.4GW to over 1.7GW, reflecting surging demand tied to AI training, inference, and cloud expansion.
The significance of the deal rests on three structural shifts:
First, it highlights the scale of capital now required to compete in AI-grade data centre infrastructure. STT GDC operates across 12 major markets in Asia Pacific, the UK and Europe, with 2.3GW of design capacity. AI workloads, especially large model training and high-density compute clusters, are driving power, cooling, land, and network requirements far beyond traditional enterprise colocation. By exiting majority ownership, ST Telemedia is effectively signaling that the next growth phase demands deeper and more specialized capital pools.
Second, the transaction reinforces private capital’s conviction in long-term data centre demand despite market cycles. With KKR taking the dominant stake, the deal shows that global infrastructure investors still view digital infrastructure, particularly AI-linked capacity, as a durable, long-horizon asset class. Even amid concerns about overbuild risks in some regions, large funds continue to back platforms with geographic diversity, committed pipelines, and enterprise and hyperscaler customer bases.
Third, the acquisition strengthens Singtel’s strategic pivot toward digital infrastructure as a growth engine. Beyond connectivity, major telcos are repositioning themselves around data centres, subsea cables, edge platforms, and cloud-adjacent services. Increasing its effective exposure to a global colocation platform gives Singtel greater leverage in cross-border enterprise, cloud, and AI ecosystems, while pairing it more tightly with a deep-pocketed financial partner that can co-fund expansion.
The pipeline growth from 1.4GW to 1.7GW in roughly a year also illustrates how quickly demand forecasts are being revised upward. AI adoption is not only increasing total compute demand but also shifting requirements toward higher-density, lower-latency, and network-rich facilities — favoring large, multi-market operators that can standardize builds and secure power at scale.
In effect, the STT GDC transaction reflects a broader consolidation pattern: operational specialists build platforms, strategic investors scale them, and financial infrastructure giants fund the next wave. As AI and cloud workloads accelerate, ownership of data centre platforms is concentrating in the hands of those able to commit billions — and to keep committing.
The transaction is also strategically important on multiple fronts. For Singtel, it reinforces a clear pivot toward scaling digital infrastructure as a core growth engine. For KKR — which is contributing the majority of the capital — it underlines continued investor conviction in the long-term fundamentals of the data centre sector. For ST Telemedia, the divestment highlights how capital intensity in the data centre market has risen sharply, with future growth increasingly dependent on access to deep funding pools and specialist infrastructure investors.
The broader direction is clear: data centre demand continues to accelerate, driven by AI, cloud, and high-density workloads, and competition for scaled assets is intensifying. Expansion at this level is now largely limited to players with substantial balance sheets or strong capital partners.
“As the data centre sector has fundamentally shifted, its exponential trajectory now requires a different scale of capital and specialised focus for STT GDC’s next exciting phase of continued growth. As a long-term, strategic shareholder, we have steadfastly supported STT GDC’s development and transformation. This transaction demonstrates our strategic stewardship while ensuring STT GDC’s ongoing sustainable growth with an optimal partner. Finally, we extend our deep gratitude to the STT GDC management and staff for their outstanding execution and dedication over the past 12 years,” said Stephen Miller, President & Group CEO of ST Telemedia.
“This acquisition is a significant step towards scaling our new growth engine in digital infrastructure as mapped out in our Singtel28 growth plan. STT GDC’s diverse geographical footprint increases our exposure to new markets and makes the Singtel Group a stronger data centre player with global reach. When added to our portfolio of data centre assets that includes Nxera in which KKR is also a capital partner, it meaningfully changes the business complexion of the Group while creating new opportunities for capital optimisation and growth,” said Arthur Lang, Group Chief Financial Officer at Singtel.
